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One of the leading theme park companies in the world has seen its revenue recover after the lifting of COVID-19-related restrictions and park shutdowns. While revenue has turned around, the company’s share price has not, which might be a factor in a recent decision that won’t sit well with customers.
What Happened: The most magical place on Earth is about to get more expensive, as media company The Walt Disney Company DIS raises prices at its Disney World theme park. The news comes shortly after the company announced its fourth-quarter financial results.
On Tuesday, Disney announced that tickets for Disney World parks will go up. Additionally, the park ticket prices will now vary based on which of the four Florida parks is being visited. Prior to the news, the ticket prices had only been variable based on demand and the time of the season and not based on the park.
Before Tuesday’s announcement, the price for a single-day ticket to any of the Walt Disney World parks ranged from $109 to $159 according to The Washington Post.
Now, tickets will range based on the park, with the following single-day ticket prices:
- Magic Kingdom: $124 to $189
- Hollywood Studios: $124 to $179
- Epcot: $114 to $179
- Animal Kingdom: $109 to $159
“We continue to focus on providing guests with the best, most memorable Disney experience, and we’re doing that by growing our theme parks with incredible new attractions and offerings,” Disney said in a statement.
Disney credited the change as making planning easier for guests.
“We are also making planning easier with new 1-day tickets that automatically include a guest’s theme park reservation and continue to provide a wide range of options to visit throughout the year, including our lowest priced ticket of $109 which has not changed in more than four years.”
The new prices will go into effect on Dec. 8. Existing prices can be locked in for next year up until the price change date.
Along with single-day passes going up in price, annual passes will also rise in price, with new annual pass sales on hold. The company’s popular Park Hopper, which allows entry to more than one park in a day, will be priced based on the date.
Disney raised the price of Genie Plus, its line-skipping offering, earlier this year. The company also raised the price of its theme park tickets at Disneyland in California just last month.
Related Link: Disney Q4 Earnings Highlights: Revenue And EPS Miss, Disney+ Hits 164.2 Miliion Subscribers And More
Why It’s Important: With the new prices, a family of four (depending on ages) would have to pay a minimum of $1,884 to visit the four parks in Florida across four days. The price increase comes as many across the country are still struggling with high inflation.
Disney’s Parks segment was on fire in 2022 compared to the prior year, with revenue up over 100% in both the first and second quarters and up over 70% in both the third and fourth quarters.
The Parks segment also saw operating income higher than the Media segment in three of the four quarters.
Disney cited higher guest volume and increased guest spending in multiple quarters as a key driver for revenue growth and operating income.
The price increases for Disney’s Florida park come after Disney CEO Bob Chapek said there was going to be a hiring freeze and job cuts.
Meanwhile, CNBC’s Jim Cramer slammed the company’s management for their handling of investor relations. “The communication between Disney and Wall Street is nonexistent,” Cramer said.
Disney World has long been one of the most visited parks in the United States. Recent price increases and high inflation could put 2023 attendance numbers in the spotlight to see if Disney’s changes had an impact on visits.
DIS Price Action: Disney shares were down 1.63% to $93.97 on Wednesday, compared to a 52-week range of $86.28 to $160.32.
Read Next: Disney+ Raises Streaming Prices Again Following Netlix And Hulu
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Image and article originally from www.benzinga.com. Read the original article here.